Gold & Silver Daily

Ed's Critical Reads

May 28, 2015

Humiliated McDonalds to Stop Reporting Monthly Sales

What do you do when month after month you have nothing but bad data to report, such as in this case McDonalds with its weekly comparable store sales shown on the ugly charts below?

Simple: you have two choice - you either seasonally adjust the data (or in the case of U.S. GDP, double-seasonally adjust it), or if that is not possible since unlike U.S. GDP, your numbers are at least somewhat indicative of underlying reality, you stop reporting them altogether.

That's what McDonalds just did.

  • MCDONALD'S LAST REPORTING OF MONTHLY COMPS WILL BE FOR JUNE
  • MCDONALD'S SAYS JUNE SAME-STORE SALES WILL BE REPORTED WITH 2Q

This commentary appeared on the Zero Hedge website at 9:41 a.m. EDT on Wednesday morning---and today's first story is courtesy of reader M.A.

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Investor Bill Gross: Bet against Bunds 'well timed, not well executed'

Bill Gross, the widely followed investor, admitted in his June Investment Outlook on Wednesday that his bet against the German Bund market was well timed but not profitable.

"My famous (infamous?) 'Short of a lifetime' trade on the German Bund market was well timed but not necessarily well executed," Gross, who runs the Janus Global Unconstrained Fund, wrote in his latest report to clients titled "Mr. Bleu."

Gross's Janus Global Unconstrained portfolio is down 0.40 percent so far this year, underperforming its peers by 1.88 percentage points and lagging 93 percent of its non-traditional bond category, according to Morningstar data on Tuesday.

This Reuters article from around 8 a.m. EDT yesterday, was picked up by the CNBC website---and the second story of the day is courtesy of Dan Lazicki.

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Billionaire Hedge Fund Manager Paul Singer Reveals the "Bigger Short"

First it was Gross, then Gundlach. Now billionaire hedge fund manager Paul Singer of Elliott Management has unveiled what he believes is the trade of this generation: being short "long-term claims on paper money, i.e., bonds." He calls it the "bigger short." First hinted at during the Grant's Spring 2015 conference, he now goes into excruciating detail.

Select excerpts from Paul Singer's latest letter.

The Big Short, of course, refers to short positions in credit in the period 2005-2007, more specifically structured credit. To be even more precise, it refers to subprime residential mortgage securitizations. It is also the name of a best-selling book by Michael Lewis about the housing and credit bubble. It was called the Big Short because many forms of credit were so overpriced that the risk/reward of taking on short positions before the financial crisis was extraordinarily favorable.

Today, six and a half years after the collapse of Lehman, there is a Bigger Short cooking. That Bigger Short is long-term claims on paper money, i.e., bonds.

This longish commentary was posted on the Zero Hedge Internet site at 6:07 p.m. EDT yesterday evening---and it's the second offering in a row from Dan Lazicki.

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Dr. Lacy Hunt on U.S. Endgame and Greatest Risk to Financial Markets

Wondering why economic growth can’t seem to take off or why inflation continues to fall? According to Dr. Lacy Hunt, Executive Vice President of Hoisington Investment Management, it all comes down to debt, which helps to explain most of the world’s economic problems today. Lacy describes the six characteristics of over-indebted economies, the most toxic type of debt to economic growth and financial stability, his view of the endgame, and why he still sees "significant value" in long-dated US Treasury bonds.

This partial transcript, along with a 6:25 minute audio clip was posted on the financialsense.com Internet site yesterday sometime---and it's another contribution from Dan Lazicki.

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Fed's Lacker: Letting Banks Fail Will Restore Market Discipline

Policymakers must ensure that financial industry creditors do not expect government bailouts and must be willing to let firms fail in order to restore market discipline, a top Federal Reserve official said.

The remarks by Jeffrey Lacker, president of the Richmond Federal Reserve Bank, repeated much of what he has previously said about what regulators need to do to make the financial system safer. Lacker, a voting member this year on the Fed's policy-setting committee, did not discuss monetary policy.

The long-term solution to ending too-big-to-fail banks is restoring market discipline "so that financial firms and their creditors have an incentive to avoid fragile funding arrangements," Lacker said in remarks prepared for delivery at the Louisiana State University Graduate School of Banking.

His remarks come amid heightened concern among Fed officials about financial stability as the U.S. central bank prepares to raise interest rates. But Lacker says less regulation, not more, is needed to make the system safer.

It's incredible what passes for 'news' these days---and there's no way on God's green earth that the U.S. government will ever allow any U.S. bank, like JPMorgan for instance, to fail.  I don't know what's in the Kool-Aid this guy is drinking.  This 'story' put in an appearance on the newsmax.com Internet site at 7:43 a.m. EDT yesterday morning---and I thank Brad Robertson for sending it.

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The Farce is Complete: FIFA, Qatar Donated to the Clinton Foundation

Earlier today, when commenting on the latest global criminal scandal, that of "rampant corruption" at FIFA, we - jokingly - said: "And now we just sit back and wait to see how many of the defendants sent "donations" to the Clinton Foundation and how many speeches Hillary and/or Bill gave at the Baur au Lac in the past two decades."

Then we decided to make sure the joke wouldn't be on us and that FIFA hadn't indeed donated to the Clinton foundation.

The joke was on us... because not only did FIFA donate to the Clinton Foundation...

This very interesting new story showed up on the Zero Hedge website at 2:14 p.m. EDT yesterday---and I thank Dan L. for finding it for us.

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LIBOR riggers included Bank of England's 'Hammer' in their e-mail plotting

A senior Bank of England official received emails that were part of an alleged campaign to rig benchmark interest rates, according to evidence presented in a London trial Wednesday.

Martin Mallett, who at the time was the chief currencies dealer at the Bank of England, was among a couple dozen recipients of emails sent in 2007 by brokers allegedly working at the behest of former bank trader Tom Hayes. The recipients were blind carbon-copied on the messages.

In the emails, the brokers sent out daily suggestions for where a variety of banks should set the London interbank offered rate, or Libor. Mukul Chawla, the prosecutor trying Mr. Hayes, said those emails were used in an attempt to skew interest rates for the benefit of Mr. Hayes, at the time a trader in Tokyo at UBS AG .

Mr. Mallett, nicknamed “The Hammer,” was sent the emails at his hammer@bankofengland.co.uk address.

This story was posted on The Wall Street Journal website yesterday morning sometime---and I found it embedded in a GATA release.  The actual headline reads "Bank of England Official Received E-mails Relating to Libor Manipulation, Prosecutor Says".  The Zero Hedge spin on this is headlined " Need to Manipulate Markets? Just E-mail the Bank of England at hammer@bankofengland.co.uk"---and I thank Dan Lazicki for that as well.

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G7 finance ministers, central bankers to meet in Dresden

Finance ministers and central bank governors of the Group of Seven wealthiest nations meet in Dresden this week to discuss the health of the global economy and financial regulation, with Greece also on the agenda.

German Finance Minister Wolfgang Schaeuble has invited his counterparts and their central bank chiefs from Britain, Canada, France, Italy, Japan and the United States, for a meeting starting Wednesday and "an in-depth exchange of views" in the eastern German city.

But there will also be other experts seated around the table, Schaeuble said in an interview with German public radio Deutschlandfunk at the weekend.

For the first time, "we've also specifically invited a number of the world's leading economists and monetary policy experts so that we can think about and find better solutions" to today's pressing economic policy issues, he said, such as striking a balance between budget consolidation and investment, and the rules of the international financial architecture.

I don't care how many so-called experts they invite, nothing will change.  This AFP story, filed from Berlin yesterday morning, was picked up by the news.yahoo.com Internet site---and it's the first offering of the day from Roy Stephens.

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With Greece "Nowhere Close" to Deal, Depositors Pull €300 Million From Banks In Single Day

On Tuesday, Greece postponed a scheduled Eurogroup meeting in Brussels without offering a reason as officials conducted “preparatory” discussions and held an evening teleconference with creditors. Face-to-face meetings will take place today with just 9 days to go until June 5 when Athens will miss a payment to the IMF, triggering an unprecedented default the repercussions of which no one can accurately predict. 

Also on Tuesday, Greek FinMin Yanis Varoufakis allegedly told Greek reporters that one measure under consideration to help stem the outflow of deposits from Greek banks was a levy on ATM withdrawals designed to encourage the use of credit cards over cash, a rather ironic suggestion coming from a government crippled by debt. The Finance Ministry was quick to deny that such a levy was being considered because after all, one way to ensure that ATM lines will get quite a bit longer is to suggest that depositors will soon be subject to a levy on withdrawals. Unfortunately, it appears as though the move to dispel the ATM tax “rumor” came too late because according to Kathimerini, deposit flight accelerated meaningfully on Tuesday.

This Greece-related story showed up on the Zero Hedge website at 7:48 a.m. EDT on Wednesday morning---and I thank reader M.A. for passing it around.

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Creditors dash Greek optimism as U.S. warns country faces an 'abyss' of a euro exit

European creditors dashed hopes that Greece was finally nearing the end-stage of its bail-out negotiations, insisting both sides remained far apart on securing the embattled country’s future in the eurozone.

Greek stock markets jumped after comments from prime minister Alexis Tsipras that the country was "close" to a deal, following reports the two sides had begun the process of drafting an agreement.

"We have made many steps. We are on the final stretch towards a positive deal," said Mr Tsipras.

"This agreement will be positive for the Greek economy, this agreement will redistribute the [financial] burdens and I believe that, very soon, we will be in a position to present more information," said the Leftist premier.

Athens' benchmark closed nearly 4pc up on the day.

This news item appeared on The Telegraph's website early yesterday morning, but has been edited in the interim---and it has also undergone a headline change, as it used to read "Greek markets jump as Alexis Tsipras says Greece is on the 'final stretch' towards bail-out deal".  It's the second contribution of the day from Roy Stephens.

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The G-7's Problem: Can the World Deal With a Greek Default?

The world’s top finance ministers and central-bank chiefs meeting in Dresden this week are already struggling to stick to an agenda set by their German hosts that doesn’t mention Greece.

In a sign of deepening global concern over the country’s stumbling bailout talks, U.S. Treasury Secretary Jacob L. Lew spoke with Greek Prime Minister Alexis Tsipras on Wednesday for the second time in less than a week and told a London audience that “everyone has to double down” on reaching an accord. European Commission Vice President Valdis Dombrovskis denied a Greek government statement that a deal is close.

The Group of Seven meeting starting on Wednesday will officially focus on big-picture themes of economic growth, tax evasion and strengthening the global financial architecture. Yet the most pressing matter for many of the policy makers attending is whether Greece can stay in the euro, and whether the world can handle the consequences if it can’t.

This Bloomberg story from 5 p.m. Denver time on Tuesday afternoon has a lot of similarities to the AFP story further up headlined "G7 finance ministers, central bankers to meet in Dresden".  But there are enough differences that I though it worth posting on its own.  I thank West Virginia reader Elliot Simon for bringing it to our attention.

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Fossil industry faces a perfect political and technological storm

The political noose is tightening on the global fossil fuel industry. It is a fair bet that world leaders will agree this year to impose a draconian “tax” on carbon emissions that entirely changes the financial calculus for coal, oil, and gas, and may ultimately devalue much of their asset base to zero.

The International Monetary Fund has let off the first thunder-clap. An astonishing report - blandly titled "How Large Are Global Energy Subsidies" - alleges that the fossil nexus enjoys hidden support worth 6.5pc of world GDP.

This will amount to $5.7 trillion in 2015, mostly due to environmental costs and damage to health, and mostly stemming from coal. The World Health Organisation - also on cue - has sharply revised up its estimates of early deaths from fine particulates and sulphur dioxide from coal plants.

The killer point is that this architecture of subsidy is a "drag on economic growth" as well as being a transfer from poor to rich. It pushes up tax rates and crowds out more productive investment. The world would be richer - and more dynamic - if the burning of fossils was priced properly.

Well, dear reader, I'll believe it when I see it.  This Ambrose Evans-Pritchard offering showed up on the telegraph.co.uk Internet site at 5:23 p.m. BST yesterday afternoon---and it's certainly worth reading.  It's the first of three in a row from Roy Stephens.

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Russia, Venezuela Agree on $14 Billion Investment in Oil, Gas Sphere

The investment is aimed at doubling oil production in the coming years, Maduro said on Wednesday, after a meeting with CEO of Russian oil giant Rosneft Igor Sechin in Venezuela's capital, Caracas.

The agreement concerns the development of the so-called Orinoco Belt — one of the richest oil reserves in the world — and projects in the gas sector, according to Maduro.

Since last summer, global oil prices have drastically dropped due to oversupply in the market. In November, the Organization of the Petroleum Exporting Countries (OPEC) decided to maintain its oil production levels, contributing to a further drop in prices and severe crises in many oil exporting nations, particularly Venezuela.

This brief article appeared on the sputniknews.com Internet site at 3:14 a.m. Moscow time this morning which was 8:14 p.m. EDT in Washington Wednesday evening.  I thank Roy Stephens for finding it for us.

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Blundering Tony Blair quits as Middle East peace envoy – only Israel will miss him

Tony Blair’s time as Middle East envoy representing the US, Russia, the U.N. and the E.U. has finally come to an end. Eight years after he took up the role, Blair tendered his resignation and left one question: how come a war criminal ever became a “peace envoy” in the first place?

The people of the Middle East – and much of the world – have been asking this question ever since Blair was appointed the Quartet’s man in Jerusalem, solemnly and hopelessly tasked to bring “peace” between Israelis and Palestinians. Was his new mission supposed to wash the blood from his hands after the catastrophe of the Bush-Blair invasion of Iraq and the hundreds of thousands of innocents who died as a result?

For Arabs – and for Britons who lost their loved ones in his shambolic war in Iraq – Blair’s appointment was an insult. The man who never said he was sorry for his political disaster simply turned up in Jerusalem four years later and, with a team which spent millions in accommodation and air fares, managed to accomplish absolutely nothing in the near-decade that followed.

This short must read commentary by Robert Fisk was posted on the independent.co.uk Internet site early this morning in London---and my thanks go out to Roy Stephens for sliding it into my in-box very late last night Denver time.

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Washington Blows Itself Up With Its Own Bomb -- F. William Engdahl

These are sad days in Washington and Wall Street. The once unchallenged sole Superpower at the collapse of the Soviet Union some quarter century ago is losing its global influence so rapidly that most would not have predicted anything comparable six months ago. The key actor who has catalyzed a global defiance of Washington as Sole Superpower is Vladimir Putin, Russia’s President. This is the real background to the surprise visit of US Secretary of State John Kerry to Sochi to meet with Russian Foreign Minister Sergei Lavrov and then a four hour talk with “Satan” himself, Putin.

Far from a “reset” try, Washington’s hapless geopolitical strategists are desperately trying to find a better way to bring the Russian Bear to her knees.

Kerry was clearly sent to Sochi to sniff out possible soft points for a renewed assault in the future. He told the rogue U.S.-backed lunatics in Kiev to cool it and respect the Minsk cease-fire accords. The demand came as a shock in Kiev. U.S.-installed Prime Minister Arseniy Yatsenyuk told French TV, “Sochi is definitely not the best resort and not the best place to have a chat with Russian president and Russian foreign minister.

At this juncture the only thing clear is that Washington has finally realized the stupidity of its provocations against Russia in Ukraine and globally. What their next scheme will entail is not yet clear. Clear is that a dramatic policy shift has been ordered on the Obama administration from the highest levels of US institutions. Nothing else could explain the dramatic shift. If sanity replaces the neo-con insanity remains to be seen. Clear is that Russia and China are resolute about never again leaving themselves at the mercy of an incalculable sole superpower. Kerry’s pathetic attempt at a second Russia “reset” in Sochi will bring Washington little at this point. The US Oligarchy, as Shakespeare’s Hamlet put it, is being “hoist with their own petard,” as the bomb maker blows himself up with his own bomb.

This commentary by Engdahl put in an appearance on the journal-neo.org Internet site on Monday---and is an absolute must read for any serious student of the New Great Game.  I thank South African reader B.V. for bringing it to our attention.

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Global trade just saw its sharpest drop since the financial crisis

The CPB Netherlands Bureau for Economic Policy Analysis, a division of the Ministry of Economic Affairs, just released its latest Merchandise World Trade Monitor, which covers global import volumes as well as global export volumes. The index dropped 0.1% in March to 136.5, after having already dropped 0.7% in February, and 1.7% in January. The index, which was set at 100 in 2005, is now down 2.5% from the peak of 140.0 in December. That 3.5-point decline was the sharpest since the Financial Crisis.

This chart, going back to January 2012, doesn’t exactly inspire confidence in the current state of the global economy.

This commentary from the wolfstreet.com Internet site was picked up by the businessinsider.com website on Tuesday---and it's something I found in yesterday's edition of the King Report.

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Patrolling the hood from (China) sea to shining sea -- Pepe Escobar

If only Mad Men in real life were like Don Draper – channeling his true inner self, after many a rocky season, to finally click on “I’m OK, you’re OK.”

Instead, we have a bunch of (Pentagon) madmen provoking every major geostrategic competitor all at once.

The Masters of War at the self-described “Don’t Do Stupid Stuff” Obama administration are now announcing they’re ready to dispatch military aircraft and ships within 18 kilometers of seven artificial islands China has built up in the Spratly Islands.

Beijing’s response, via the Global Times, couldn’t be other than There Will be War; “If the United States’ bottom line is that China has to halt its activities, then a U.S.-China war is inevitable in the South China Sea … The intensity of the conflict will be higher than what people usually think of as ‘friction’.

This must read commentary by Pepe appeared on the Asia Times website yesterday---and it's the final contribution of the day from Roy Stephens and, once again, I thank him on your behalf.

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Chinese mining group buys $710 million in gold and copper assets

Zijin Mining Group will buy US$710 million worth of gold and copper mining assets from two Canadian companies in the Democratic Republic of Congo and Papua New Guinea with funds raised through a private placement in the Shanghai stock market.

Zijin told the Shanghai and Hong Kong stock exchanges on Tuesday it would buy a 49.5 per cent stake in the Kamoa copper project in the Democratic Republic of Congo from Ivanhoe Mines for US$412 million.

Zijin already owns 9.9 per cent of Ivanhoe, which recorded a net loss of US$52.9 million last year following a net loss of US$80.6 million in 2013.

Fujian-based Zijin will also pay Barrick Gold Corp US$298 million for a 49.5 per cent interest in the Porgera gold mine in Papua New Guinea.

This news item showed up on the South China Morning Post on their Wednesday---and I found it embedded in a GATA release.

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Direxion Asset Management closing 3X leveraged gold ETF

The Direxion Shares ETF Trust II has decided to liquidate and close the Direxion Daily Gold Bull 3X Shares (BAR) exchange-traded fund based on the recommendation of Direxion Asset Management LLC, the fund's sponsor.

Due to the fund's inability to attract sufficient investment assets, Direxion believes the fund cannot continue to conduct its business and operations in an economically efficient manner. As a result, Direxion concluded that liquidating and closing the fund would be in the best interests of the fund and its shareholders.

Shares of the Fund will stop trading on the NYSE Arca Inc. and will no longer be open to purchase by investors after the close of regular trading on June 19, 2015. Shareholders may sell their holdings in the fund prior to June 19 and those transactions may be subject to customary brokerage charges. Between June 22 and June 26 shareholders may be able to sell their shares only to certain broker-dealers and there is no assurance that there will be a market for the fund during that time.

This gold-related story appeared on the prnewswire.com Internet site on Tuesday---and it's another article I found on the gata.org Internet site yesterday.

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Could South Africa’s gold mining industry be gone by 2020?

The South African mining industry is in trouble. That is not in question. The only debatable point is exactly how much trouble it is in.

The industry on which this country’s modern economy was built has been stuttering since the global financial crisis. What investors and anyone else with an interest in mining’s role in the economy wants to know, is where this is headed.

Are we nearing a point where we will start to see a turnaround? Or is there a chance that things will simply continue to deteriorate?

Speaking at the JSE’s Power Hour in Cape Town, Peter Major, mining specialist at Cadiz Corporate Solutions, warned that one must be wary of thinking that things will always revert to an historically established mean. The mining environment in South Africa has changed so much over the last few decades that “the old rules no longer apply”.

Well, dear reader, as long as these so-called experts and current crop of mining executives don't get on stick pretty soon, ALL of the world's precious metal miners are going to be heading in the same direction.  I know for a fact that there isn't a mining executive out there that doesn't know that the metals they mine isn't being managed by JPMorgan et al.  They just won't do anything about it.

This article was posted on the mineweb.com Internet site yesterday afternoon London time---and it's worth reading.

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May 27, 2015

The world is drowning in debt, warns Goldman Sachs

The world is sinking under too much debt and an ageing global population means countries' debt piles are in danger of growing out of control, the European chief executive of Goldman Sachs Asset Management has warned.

Andrew Wilson, head of Europe, Middle East and Africa (EMEA), said growing debt piles around the world posed one of the biggest threats to the global economy.

"There is too much debt and this represents a risk to economies. Consequently, there is a clear need to generate growth to work that debt off but, as demographics change, new ways of thinking at a policy level are required to do this," he said.

"The demographics in most major economies – including the US, in Europe and Japan - are a major issue – and present us with the question of how we are going to pay down the huge debt burden. With life expectancy increasing rapidly, we no longer have the young, working populations required to sustain a debt-driven economic model in the same way as we've managed to do in the past."

This story from The Telegraph is datelined at 6:25 p.m. BST yesterday evening, which is a pretty neat trick considering that our man in Greece, Harry Grant, sent it to me at 5:37 a.m. EDT yesterday morning, so it's obviously been edited in the interim.

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El-Erian: Correction in stocks could happen if…

There could be a "big air pocket" in stocks if fundamentals, at some point, don't validate valuations, Mohamed El-Erian said Tuesday.

The market has been supported by "ultra-loose" monetary policy around the world and cash from corporate balance sheets being put to work in the form of dividends, buybacks and mergers and acquisitions, Allianz' chief economic adviser said on CNBC's "Squawk Box."

While the Federal Reserve will probably hike interest rates this year for the first time in nearly a decade, El-Erian advised investors against obsessing over it.

This 4:11 minute CNBC video clip, along with a transcript, appeared on their website at 8:40 a.m. EDT yesterday morning---and I thank Dan Lazicki for his first story of the day.

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JPMorgan Chase Writes Arrogant Letter to Its Swindled Forex Customers

As the U.S. Department of Labor deliberates giving JPMorgan Chase a waiver to continue business as usual after it pleaded guilty to a felony charge for engaging in a multi-bank conspiracy to rig foreign currency trading, a letter the bank sent to its foreign currency customers should become Exhibit A in the deliberations. The letter effectively tells JPMorgan’s customers, here’s how we’re going to continue to rip your face off.

Two sections of the letter stand out in particular. One section reads:

“As a market maker that manages a portfolio of positions for multiple counterparties’ competing interests, as well as JPMorgan’s own interests, JPMorgan acts as principal and may trade prior to or alongside a counterparty’s transaction to execute transactions for JPMorgan…” (Italic emphasis added.)

I posted the JPMorgan "I'm so sorry" letter in Tuesday's column, or on Saturday---and here's what the good folks over at the wallstreetonparade.com Internet site had to say about it yesterday.  I thank Richard O'Mara for sending it along.

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JPMorgan’s Guilty Plea Puts Wealth Unit in Spot With Regulators

JPMorgan Chase & Co. put allegations of currency-fixing largely behind it with a guilty plea, but it’s not out of the woods yet.

With its new felony record, America’s biggest bank needs to seek the Department of Labor’s permission to keep managing money in the $8 trillion private pension market. At the same time, there’s a cloud over the JPMorgan unit where pensions are managed: The Securities and Exchange Commission is well along in an investigation into conflicts of interest in the bank’s wealth-management unit, whose products include individual retirement accounts.

That puts the bank in a sticky position -- arguing that a criminal conviction shouldn’t keep it from managing Americans’ retirement savings, while the SEC is investigating possible wrongdoing in the same division.

“When a bank has enforcement action after enforcement action, it becomes hard to argue that it won’t happen again,” says Urska Velikonja, an assistant law professor at Emory University whose research focuses on securities law.

Of course there will be no end to it, but the precious metal price management scheme is still the 1,000 pound gorilla in the living room.  This Bloomberg article showed up on their website at 3:00 a.m. Denver time on Tuesday morning---and it's the first offering of the day from West Virginia reader Elliot Simon.

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After a Political Reversal in Alberta, ‘Anything Seems Possible’

This is the Canadian province known for oil, cowboys and rodeos, and as the adopted home of Prime Minister Stephen Harper, whose Conservative Party has long dominated politics.

So it seemed especially jarring when a boisterous crowd in this bastion of conservative voting known as Canada’s Texas celebrated its new premier this weekend: a woman regarded by much of the country as a leftist who vows to take on big oil and champion the poor.

The 51 newly elected New Democratic Party members who sat behind the premier, Rachel Notley, their leader, in the swearing-in ceremony on Sunday did not resemble typical revolutionaries. Largely political novices, they dressed like junior bank managers. They include nurses, a phone technician and a yoga instructor.

The ceremony on the steps of the Alberta provincial legislature, cheered by members of a large and enthusiastic crowd who could have easily passed for hockey fans celebrating a rare Edmonton Oilers victory, signified an exceptional moment in politics in both Alberta and Canada.

Yep---and if I were Prime Minister Stephen Harper, I'd be shaking in my boots right now, as the Canadian people are just itching to give this guy, along with the rest of the Federal conservatives, the old 'heave ho'---and they'll have their chance this fall.  This is another article from The New York Times.  This one was posted on their website on Monday---and I thank Roy Stephens for sending it along.

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Vancouver: Real estate ‘pandemonium’

Mortgage broker David Ford thinks he has found the right way to describe the Lower Mainland’s market for single-family homes.

“Detached housing is BANANAS.

“It’s real estate pandemonium,” he writes in his latest Shop Talk newsletter for clients, realtors and financial advisers.

It’s not just single-family homes that are hot. Vancouver Mayor Gregor Robertson and former wife Amy received five offers recently for their 1,666-square-foot Stephens St. half-duplex in Kits with ocean views, purchased in 2013 for $1.57 million. Listed for $1.798 million. Sold for $1.982 million.

This story showed up on The Vancouver Sun website yesterday---and it's the second offering in a row from Roy Stephens.

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Germany sees progress on Greece, E.U. officials to confer on Thursday

A senior German official said on Tuesday there was no reason to believe Greece would be in default after a 300 million euro payment to the IMF falls due on June 5.

Separately, euro zone officials said deputy finance ministers would hold a teleconference on Thursday to follow up on days of negotiations between representatives of Greece and creditors the International Monetary Fund (IMF), the European Central Bank and the European Commission.

Greece must repay four loans totaling 1.6 billion euros ($1.76 billion) to the IMF next month, starting with a 300 million euro payment on June 5.

If no deal is reached within EU/IMF for new loans to be disbursed to Athens, Greece is likely to default on the IMF loan repayment. This would start a process that could lead Greece out of the euro zone.

Will they?---Won't they?  What a soap opera.  This Reuters article co-filed from Berlin and Brussels, put in an appearance on their Internet site at 11:00 a.m. EDT yesterday morning---and it's the second offering of the day from Elliot Simon.

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With Money Drying Up, Greece Is All but Bankrupt

Bulldozers lie abandoned on city streets. Exhausted surgeons operate through the night. And the wealthy bail out broke police departments.

A nearly bankrupt Greece is taking desperate measures to preserve cash. Absent a last-minute deal with its creditors, the nation will run out of money early next month.

Two weeks ago, Greece nearly defaulted on a debt payment of 750 million euros, or about $825 million, to the International Monetary Fund.

For the rest of this month, Greece should be able to cover daily cash deficits of around 100 million euros, government ministers say. Starting June 5, however, these shortfalls will rise sharply, to around 400 million euros as another I.M.F. obligation comes due. They will then double in size on June 8 and 9.

This article, filed from Athens, appeared on The New York Times website on Monday sometime---and it's another contribution from Elliot Simon.  David Stockman gave it the headline "At the Street Level, Greece is Grinding to a Halt".

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Russia Officially Gives Up on Mistral Deal

Moscow has finally given up on the Mistral deal. Now Russia and France will discuss only the sum that Paris should pay Russia for the failed contract.

During the negotiations on the Mistral deal Russia and France have discussed only one question — the sum of the compensation.

"We switch the conversation to business — give us our money back… We're now discussing just one thing — the exact sum of money France owes Russia," Oleg Bochkaryov, a deputy chairman of the Russian Military Industrial Complex said.

Russia and France signed a $1.3-billion deal for two Mistral-class helicopter carriers in 2011. The handover of the first ship to Russia was scheduled for November 2014, but never happened. French President Francois Hollande put the delivery on hold due to Moscow's alleged interference in the Ukrainian crisis.

This news item appeared on the sputniknews.com Internet site at 5:02 p.m. Moscow time on their Tuesday afternoon, which was 10:02 a.m. EDT in Washington.  It's courtesy of Dan Lazicki.  The Zero Hedge spin on this is headlined "Russia Tells France It Gives Up on Mistral Ship Deal"---and it's also courtesy of Dan L.

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Muslim world reacts to Obama's latest speech

This 2:20 minute youtube.com video clip appeared on Egyptian television last week---and it falls into the absolute must watch category.  I could hardly believe what I was hearing---and I thank reader U.D. for passing it around yesterday.

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ISIS rise provoked by outside interference into Middle East, North Africa – Putin

There was previously no terrorism in countries where Islamic State militants “now prosper” until outside forces “not sanctioned by the UNSC” interfered, Russian President Vladimir Putin said, stressing the “serious consequences” that followed.

“We know what is happening, for example, in the Middle East, in North Africa; we know the problems associated with a terrorist organization, which has appropriated the right to be called the ‘Islamic State” (IS, formerly ISIS/ISIL),” Putin said during a meeting with security officials from the BRICS block in Moscow.

“But there was no terrorism in the countries where it [IS] flourishes today before an unacceptable interference from the outside happened, not sanctioned by the Security Council of the United Nations,” he stressed.

Russia’s president describe the consequences of such interference as “serious,” with the Islamic State currently controlling territory in Syria, Iraq, Libya, Lebanon, Afghanistan and Nigeria.

This news item showed up on the Russia Today website at 9:37 p.m. Moscow time on their Tuesday evening---and I thank Roy Stephens for sending it along.

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Saudi Arabia, partners turn down Chinese requests for extra oil

Saudi Arabia and its main Middle East OPEC partners are turning down Chinese requests for extra oil as they hold back fuel for their own refineries just as demand from the world's biggest crude importer hits new records.

While the Saudi and other refusals for additional crude supplies may not be part of a new pricing strategy, the rejections to their biggest client help explain a 40 percent rise in oil prices this year as Chinese importers have had to seek more oil from other suppliers in what analysts say is still an oversupplied market.

Saudi Arabia "used to provide as and if we asked for extra cargoes on top of contract during the first four months of the year, but not for May and June," said a trader with one of China's biggest oil importers on condition of anonymity as he had no permission to talk to media.

Another source with a Chinese refinery that takes Saudi oil said Saudi heavy crude was "a bit tight" in May and June.

This Reuters article, co-filed from Beijing and Singapore, was posted on their website a week ago today---and I thank Orlando, Florida reader Dennis Mong for sharing it with us.

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Iraq About to Flood Oil Market in New Front of OPEC Price War

Iraq is taking OPEC's strategy to defend its share of the global oil market to a new level.

The nation plans to boost crude exports by about 26 percent to a record 3.75 million barrels a day next month, according to shipping programs, signaling an escalation of OPEC strategy to undercut U.S. shale drillers in the current market rout. The additional Iraqi oil is equal to about 800,000 barrels a day, or more than comes from OPEC member Qatar. The rest of the Organization of Petroleum Exporting Countries is expected to rubber stamp its policy to maintain output levels at a meeting on June 5.

While shipping schedules aren't a promise of future production, they are indicative of what may come.

This Bloomberg article showed up on their Internet site at 8:37 a.m. EDT yesterday morning---and I thank International Man senior editor Nick Giambruno for passing it around yesterday.

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China's currency 'no longer undervalued,' IMF says, clearing entry to SDRs

The International Monetary Fund has declared that China's currency is "no longer undervalued," marking a significant shift after more than a decade of criticism of Beijing's tight management of the renminbi.

The move amounts to a major vote of confidence in Beijing and the renminbi at a critical time. It also puts the IMF at odds with its biggest shareholder, the United States, which insists that China continues to draw an unfair trade advantage from a renminbi that it considers "significantly undervalued."

The renminbi has gained 25 per cent against the US dollar since it was allowed to adjust upward within a narrow band a decade ago, and has held its value even as the dollar has strengthened against other major currencies over the past year.

Eswar Prasad, the former head of the IMF's China unit, said the shift by the fund was important as it marked the first time since the Asian financial crisis of the late 1990s that the fund had not deemed the renminbi to be undervalued. It also presaged the likely adoption later this year of the renminbi as one of the small number of major currencies in a basket used to determine the value of the IMF's de-facto currency, the Special Drawing Rights.

This is only part of the story that appeared on the Financial Times website yesterday.  There's a bit more in the GATA release, but you'll have to go to the FT site for the rest---and a subscription is required.  The part that's posted in the clear is worth reading.

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Texas Senate Passes Bill to Establish Bullion Depository, Help Facilitate Transactions in Gold and Silver

A bill taking a step towards gold and silver as commonly-used legal tender in Texas passed in the state Senate today by an overwhelming 29-2 vote.

Introduced by State Rep. Giovanni Capriglione (R- Southlake) and four co-sponsors on Feb. 12, House Bill 483 would create a state bullion depository.

What the bill essentially does is create a means for transactions to occur in precious metals. It allows people  to open an account and deposit their precious metals in the state depository. They could then use the electronic system to make payments to any other business or person who also holds an account.

This opening of the market is considered by many insiders to be the most important first step towards bringing sound money to mainstream acceptance.

This news item, filed from Austin yesterday, appeared on the tenthamendmentcenter.com Internet site---and it's something I found over at Sharps Pixley in the wee hours of this morning.

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MIT developing platinum replacement

Fears of a looming crunch in platinum supply, driven mainly by a four-month-long ongoing strike at the world’s top producers of the metal in South Africa, may be about to fade.

MIT graduate student Sean Hunt, postdoc Tarit Nimmandwudipong, and Yuriy Román, an assistant professor of chemical engineering, are working on a new process to replace platinum-group metals (PGMs) with more widely available elements in renewable energy technologies.

In a paper published last week in the journal Angewandte Chemie, the team explains their proposed new method for synthesizing alternative catalysts.

This is another one of those cases of "I'll believe it when I see it!"  This short article was posted on the mining.com Internet site  back on May 18---and I thank Patrick Leavens for sending it our way.

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Platinum price: The cheese and biscuits analogies -- Lawrence Williams

Platinum has been in a large deficit for the last two to three years – and a substantial one at that, last year in particular with the five-month long platinum miners’ strike in South Africa taking perhaps a further 1 million ounces away from the production picture. But, over this same period, the price has not risen, but has fallen, thus seemingly being counter to the normal supply/demand process.

An interesting panel discussion at last week’s Bloomberg Precious Metals Forum in London did not see an immediate end to this price malaise, although looking further ahead did feel there would be a stage when fundamentals would start to impact price positively. Panel members were David Jollie of Mitsui Global Precious Metals, Jonathan Butler of Mitsubishi and James Steel of HSBC, ably led by Rupen Raithatha of Johnson Matthey who had previously given the audience insights on the very significant demand for platinum in the Chinese jewellery sector.

The weak price has been all to do with the levels of above-ground stocks which some had put at over 4 million ounces, which meant there has been adequate supply out there to service demand. This without impacting positively on the price which, if anything, has allied itself to the fortunes of the gold price however illogical this might be. Indeed it was felt that we may still not yet have seen the platinum price lows if gold hits a spot of further weakness as some analysts have been predicting. Although platinum is very much an industrial metal, it is also classified by the markets as a precious metal and all the precious metals complex tends to move, to an extent at least, with the upwards and downwards movements in the gold price.  This in turn seems to move due to the huge speculative element played out for the moment primarily on the COMEX futures market.

This commentary by Lawrie appeared on the mineweb.com Internet site mid-afternoon BST in London---and if you're a PGM fan, this is worth reading.

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Don’t Believe Everything You Read On The Internet -- Koos Jansen

Recently a website called Want China Times published a story titled, “China Could Crash U.S. Dollar With 30,000 Tons Of Gold: Commentary”. I would like to share my opinion on this story about the Chinese gold market that has directly or indirectly reached many readers.

Alasdair Macleod has written an article in 2014 stating “the Chinese state has probably accumulated between 20,000 and 30,000 tonnes since 1983”. In my humble opinion this estimate is based on no evidence, but you can read the article and make up your own mind. Now, was the 30,000 tonnes number conceived by MacLeod or Jin? The only source I could find on the 30,000 tonnes number is MacLeod’s estimate. In a new Chinese jacket (Duowei, Jin) the story was transformed and made additional rounds. (if someone else has an additional source I would love to read it, please comment below.)

Starting from BWChinese via Duowei and Want China Times the 30,000 tonnes story was re-ignited and has spread over the internet. Shortly after Russian website pravda.ru published, “China Saves Up 30,000 Tons Of Gold To Topple US Dollar From Global Reign”. Pravda did not include any links, but they mention Duowei as the source (so again, this was MacLeod’s estimate). Sputnik published "Dragon Rising: China's Gold Will Break World's Dependence on the U.S. Dollar".

This very interesting commentary appeared on the bullionstar.com Internet site yesterday---and it's worth reading.  I thank Koos for sending it our way.

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Russia acquires gold as defense against 'political risks,' central banker explains

Russia is increasing its gold holdings because gold is a reserve asset free from legal and political risks, a senior central banker said on Tuesday.

The comments by Dmitry Tulin, who manages monetary policy at the central bank, reflect Russian fears that the country's overseas assets could be frozen as part of a possible toughening of Western sanctions over the Ukraine crisis.

"As you know we are increasing our gold holdings, although this comes with market risks," Tulin told lawmakers in the lower house of parliament. "The price of it swings, but it is a 100-percent guarantee from legal and political risks."

This Reuters article from late Tuesday morning EDT was something I found in a GATA release.

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Gold smuggling in India rises 900% to record

For the first time in the history of gold smuggling in India, the seizure in illicit trade has crossed the rupees 1,000 crore mark in one financial year with customs, police, and revenue agencies seizing more than 3,500 kilograms of gold in 2014-15.

In 2012-13 the same figure stood at merely Rs 100 crore with just about 350 kilograms of gold seized. In two years, since the government increased duty on gold to 10 percent to rein in a yawning current account deficit, gold smuggling has grown by 900 percent.

Since as an accepted principle seizures could be less than 10 percent of actual smuggling, the figures look even more ominous.

Sources say gold has also begun to be smuggled in unique ways and from rather unexpected corners.

This article showed up on the Times of India website at 4:31 a.m. IST on their Wednesday morning---and I found this one the gata.org Internet site yesterday.  It's worth reading.

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Turn out the lights: Australia calls commodity spending boom end

Gold miners are spearheading a wave of merger and acquisition activity in Australia, riding a rebound in local gold prices to pounce on projects promising quick growth.

In the first signs of life since the country’s mining boom went bust three years ago, companies are buying assets from international rivals tightening their belts, and partnering with fellow Australian miners.

“Everyone is looking for assets that enable them to grow. We’ve seen more M&A in Australia in 2015 than in the past five years,” Ian Murray, chairman of Perth-based Gold Road Resources Ltd told Reuters, referring broadly to the level of interest in the sector.

Progressive central bank interest rate cuts aimed at knocking down the Australian dollar and falling labour and mining costs are adding fuel to the frenzy.

This Reuters article appeared on the mineweb.com Internet site yesterday morning BST---and I found it all by myself.

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May 26, 2015

Did Someone Forget to Tell the Machines the U.S. is Shut Today?

"Unrigged"... European weakness - on the heels of increasing event risk and slowing ECB purchases - provided downward impetus to global risk assets this morning... but the machines rigging running U.S. equity futures appears to have forgotten that the U.S. markets are shut and sparked the ubiquitous rampathon back to unchanged for S&P futures (on less than 10% of daily average pro-rata volume).

The same can be said of the trading in gold and silver yesterday as well.  This tiny Zero Hedge article has a must see chart embedded, so it's worth 30 seconds of your time.

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Don Coxe: Bull Market in Bonds Now Ending - Risks Ahead

Don Coxe, Chairman of Coxe Advisors, called the dawn of the bull market in bonds in 1981. Now, 34 years later, he sees it ending as bonds enter their final mania phase marked by negative interest rates. Don discusses this historic period we are now in and both the risks and opportunities he sees ahead.

This excellent transcript, plus an embedded 6:27 minute video clip, appeared on the financialsense.com Internet site on Friday---and it's definitely worth your while.  I thank Casey Research's own John Grandits for passing it around on Sunday afternoon.

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Dr. Dave Janda interviews your humble scribe

The good doctor and I spent 25 minutes talking about the banks in general---and JPMorgan in particular---on Sunday afternoon.  Of course we also spent some time talking about the precious metals as well.  It was posted on the davejanda.com Internet site yesterday.

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Ferguson Protesters Now Protesting Over Not Getting Paid

At least some of the protesters who looted, rioted, burned buildings and overturned police cars in Ferguson, Missouri, last year were promised payment of up to $5,000 per month to join the protests.

However, when the Missourians Organizing for Reform and Empowerment (MORE), the successor group to the now-bankrupt St. Louis branch of ACORN (Association of Community Organizations for Reform Now), stiffed the protesters, they launched a sit-in protest at the headquarters of MORE and created a Twitter page to demand their money, The Washington Times reports.

Presidential candidate and former Rep. Allen B. West, [R-Fl.], noted on his website, "Instead of being thankful for getting off the unemployment line for a few weeks and having a little fun protesting, the paid rioters who tore up Ferguson, MO, are protesting again."

"First of all, can you even imagine getting paid $5,000.00 a month for running around holding a sign and burning down an occasional building? That's around $1,250.00 per week. Try making that at McDonalds or Starbucks."

MORE is funded by liberal billionaire George Soros, the Times notes, through his Open Society Foundations (OSF).

Only in America.  This amazing story appeared on the newsmax.com Internet site at 3:07 p.m. EDT on Memorial Day---and it's another contribution from reader U.D.  It's definitely worth reading.

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Businesses quietly turn to the dollar in fiercely anti-American Venezuela as currency crashes

It's still possible to buy a gleaming Ford truck in Venezuela, rent a chic apartment in Caracas, and snag an American Airlines flight to Miami. Just not in the country's official currency.

As the South American nation spirals into economic chaos, an increasing number of products are not only figuratively out of the reach of average consumers, but literally cannot be purchased in Venezuelan bolivars, which fell into a tailspin on the black market last week.

Businesses and individuals are turning to dollars even as the anti-American rhetoric of the socialist administration grows more strident. It's a shift that's allowing parts of the economy to limp along despite a cash crunch and the world's highest inflation. But it could put some goods further out of reach of the working class, whose well-being has been the focal point of the country's 16-year-old socialist revolution.

This AP story was picked up by the startribune.com Internet site at 1:45 p.m. EDT yesterday---and I found it on the gata.org Internet site.

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Banks brace for more foreign exchange rigging pain as civil lawsuits come forth

Banks are bracing for hundreds of millions of pounds in new claims for foreign exchange manipulation from class-action lawsuits triggered by last week’s vast market rigging fines.

Barclays, Royal Bank of Scotland and four other banks were ordered on Wednesday to pay $6bn (£3.84bn) by U.K. and U.S. authorities.

The Barclays penalty represents the biggest bank fine in British history.

The regulators, detailing how traders gathered in chat rooms using monikers such as “The Cartel” and “Coiled cobra” to rig the $5.3 trillion-a-day currency market, also forced the banks to plead guilty to criminal charges.

Lawyers say that the fines, as well as an investigation from the European Commission, could be a springboard to damaging civil litigation in the U.K. and Europe.

This article put in an appearance on the telegraph.co.uk Internet site at 7:46 p.m. London time on their Saturday evening---and I found it embedded in a GATA release.

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E.U. parliament cracks down on shell firms

People trying to hide their money in shell companies will face greater scrutiny following a new law adopted Wednesday (20 May) by the European Parliament.

Initially proposed at the start of 2013, the bill - also known as the fourth anti-money laundering directive - proposed to crack down on money laundering, terrorist financing, and to improve ways of tracing illicit transfers.

A political agreement with member states was reached last December.

MEPs expanded on it, making it more difficult for fraudsters and other criminals to hide behind shell companies to avoid paying taxes or to launder income from criminal activities. Member states have two years to transpose the rules into their national laws.

This story, filed from Brussels, showed up on the euobserver.com Internet site last Wednesday---and the reader that sent it to me wishes to remain anonymous.

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Spain's ruling party punished in local elections

Voters in Spain’s two biggest cities have put the leaders of new and untried citizens’ platforms in pole position to become their mayors as the results of Spain’s local and regional ballots on Sunday reveal a highly fragmented political scene ahead of a general election due at the end of the year.

Barcelona en Comú, whose city council candidates were supported by anti-austerity movement Podemos and the Left-wing Catalan Green party, won 11 councillors with 25 per cent of the vote, narrowly ahead of the CiU Catalan nationalist grouping of current city mayor Xavier Trias, which picked up 10 seats out of 41 available.

Barcelona en Comú leader Ada Colau, formerly known as an anti-eviction campaigner, has promised a drastic reduction in perks for councillors and an emergency anti-poverty plan for the city’s poor and marginalised. “It’s a David versus Goliath victory,” a tearful Mrs Colau said as the result came in.

“We said it could be done, and we’ve proven it,” said Mrs Colau. “We are an unstoppable democratic revolution.”

This story appeared on The Telegraph's website just before midnight BST on Sunday evening---and I thank Roy Stephens for sharing it with us.

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Greece to miss IMF payments amid fears of 'catastrophic' eurozone rupture

Greece will be unable to find the €1.6bn (£1.1bn) sum it is due to hand the International Monetary Fund (IMF) next month, one of the country’s ministers has admitted.

Nikos Voutsis, the Greek minister of the interior, said that “this money will not be given and is not there to be given”, speaking on Mega TV. The Greek state is due to hand over the money in four installments in June, as part of its obligations for its 2011 bail-out.

Mr Voutsis’ comments came as Yanis Varoufakis, the Greek finance minister, told The Andrew Marr Show that if progress was not made, it would be the beginning of the end for the euro project.

This is another story from the telegraph.co.uk Internet site.  It showed up there at 10:50 a.m. BST on Sunday morning---and it's the second story in the row from Roy Stephens.  Our man in Greece, Harry Grant, sent us the Zero Hedge spin on all this headlined "Greece Is on the Ragged Edge: Bloodied Ideologues vs. Bloodthirsty Technocrats".  And here's another story on Greece from The Telegraph.  This one's from Monday morning BST---and it's headlined " Greece begs for leniency as investors warn 'time for complacency' on collapse is over"---and it's courtesy of Roy Stephens as well.

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No to Brussels, Yes to Kiev: New president sets course for more independent Poland

Youthful energy and rhetoric for change have seen Andrzej Duda transformed from a virtual unknown to the rising star of Eastern European politics – but his presidency could set Poland against Russia and the E.U.

On Sunday, 51.6 percent of the electorate cast their votes for Duda to replace the centrist incumbent Bronislaw Komorowski, with a turnout of 55.4 percent, according to the official results. Exit polls showed that over 60 percent of rural voters supported Duda, but only about 40 percent of those live in cities.

Like the last president from the Law and Justice party and Duda’s idol, the late Lech Kaczynski, who held the office from 2005 to 2010, the new Polish leader won by appealing to voters from the traditional heartlands – Catholics, social conservatives, farmers, and those left behind by Poland’s superficially stellar economic performance in the last decade.

This story was posted on the Russia Today website at 9:52 p.m. Moscow time on their Monday evening, which was 2:52 p.m. EDT in Washington.  It's also courtesy of Roy Stephens.

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Ukraine crisis: Rebel commander Alexei Mozgovoi 'killed'

One of the top rebel commanders in eastern Ukraine, Alexei Mozgovoi, has been killed in an attack on his car, Russian and Ukrainian media report.

Mr Mozgovoi led the "Prizrak" (Ghost) battalion which was based in the Alchevsk area of Luhansk.

Reports said a bomb struck his car, which was then targeted by gunfire that killed Mozgovoi and six others.

Mr Mozgovoi was a critic of the Russian-backed separatist leadership and the Minsk accord signed with Kiev.

This story put in an appearance on the bbc.com website on Saturday sometime---and I thank Jim Skinner for sending it along.

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Putin signs bill on ‘undesirable foreign groups’ into law

The Russian president has signed a bill banning the activities of foreign groups that pose a threat to national security or defense capability, and to punish those who continue to cooperate with such groups.

The bill, initially drafted by two opposition MPs, was passed by both chambers of the Russian parliament last week. It tasks the Prosecutor General’s Office and the Foreign Ministry with creating a proscribed list of “undesirable foreign organizations” and to outlaw their activities in the country. The main criterion for putting a foreign or international NGO on the list is a “threat to the constitutional order and defense capability, or the security of the Russian state.”

Once the group is recognized as undesirable, all its assets in Russia must be frozen, its offices closed and distribution of any of its information materials must be banned.

No surprises here, as foreign-sponsored NGO's, mostly U.S., have been working in many countries to overthrow their current governments.  This news story was posted on the Russia Today website at 9:52 a.m. Moscow time on their Monday morning, which was 2:52 a.m. EDT in Washington.  There was also a Fox News item on this headlined "Putin signs Russian law to shut down 'undesirable' organizations"---and it's courtesy of Brad Robertson.

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City in the sky: world's biggest hotel to open in Mecca

The holy city is fast becoming a Las Vegas for pilgrims.

Four helipads will cluster around one of the largest domes in the world, like side-plates awaiting the unveiling of a momentous main course, which will be jacked up 45 storeys into the sky above the deserts of Mecca. It is the crowning feature of the holy city’s crowning glory, the superlative summit of what will be the world’s largest hotel when it opens in 2017.

With 10,000 bedrooms and 70 restaurants, plus five floors for the sole use of the Saudi royal family, the £2.3bn Abraj Kudai is an entire city of five-star luxury, catering to the increasingly high expectations of well-heeled pilgrims from the Gulf.

Modelled on a “traditional desert fortress”, seemingly filtered through the eyes of a Disneyland imagineer with classical pretensions, the steroidal scheme comprises 12 towers teetering on top of a 10-storey podium, which houses a bus station, shopping mall, food courts, conference centre and a lavishly appointed ballroom.

“The city is turning into Mecca-hattan,” says Irfan Al-Alawi, director of the UK-based Islamic Heritage Research Foundation, which campaigns to try to save what little heritage is left in Saudi Arabia’s holy cities. “Everything has been swept away to make way for the incessant march of luxury hotels, which are destroying the sanctity of the place and pricing normal pilgrims out.”

This very interesting article showed up on The Guardian website on Friday afternoon BST---and it's the second contribution in a row from reader Brad Robertson.

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‘Titanic’ Global Economy May “Collapse” Warn HSBC – Gold Is Lifeboat

The chief economist of the world’s third largest bank, HSBC’s Stephen King, has compared the global economy to the Titanic.

In a note to clients on Wednesday he wrote We may not know what will cause the next downswing but, at this stage, we can categorically state that, in the event we hit an iceberg, there aren’t enough lifeboats to go round.

“The world economy is like an ocean liner without lifeboats.” As we have been warning in recent months, when another recession arrives, governments do not have the ability or the reserves to prop up the economy like they did in 2008.

Global debt has soared by 40 percent since the Great Recession. We now have a staggering $200 trillion of debt globally, or almost three times the size of the global economy. It would be a “truly titanic struggle” for policymakers to right the economy, King said.

This commentary by Mark O'Byrne over at the goldcore.com Internet site on Friday was something I meant to stick in Saturday's column, but completely forgot about---so here it is now.  If you haven't already, it's worth reading.  Here's The Telegraph's spin on this, courtesy of Ambrose Evans-Pritchard.  It's headlined "HSBC fears world recession with no lifeboats left"---and I thank Roy Stephens for finding it for us.

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60 countries invest in Chinese fund to facilitate central bank gold purchases

A gold-sector fund involving countries along the ancient Silk Road has been set up in northwest China's Xi'an City during an ongoing forum on investment and trade this weekend.

The fund, led by the Shanghai Gold Exchange, is expected to raise an estimated 100 billion yuan (U.S. $16.1 billion) in three phases.

China is the world's largest gold producer and a major importer and consumer of gold. Among the 65 countries along the routes of the Silk Road Economic Belt and the 21st-Century Maritime Silk Road, there are numerous Asian countries identified as important reserve bases and consumers of gold.

About 60 countries have invested in the fund, which will in turn facilitate gold purchases for the central banks of member states to increase their holdings of the precious metal, according to the SGE.

This gold-related item, filed from Xi'An in China, appeared on the xinhuanet.com Internet site at 6:18 p.m. Beijing time on their Saturday evening.  I found it in a GATA release.  Koos Jansen also has something on this---and it's headlined "Xinhua: China Sets Up Gold Fund For Central Banks".  His comments are a must read.  The Zero Hedge spin on this is entitled "China Establishes World's Largest Physical Gold Fund"---and it's courtesy of reader M.A.

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Australian gold production falls in first quarter of 2015

Australian gold production fell by 7 per cent in the first quarter of this year.

Less than 70 tonnes of the precious metal was pulled from the ground in the first three months of 2015, according to mining consultancy firm Surbiton Associates.

Director Dr. Sandra Close said the low figure was in part due to a number of shutdowns, wet weather and fewer production days from January to March.

"March is usually the lowest quarter of the year anyhow, but overall both the grade and tonnage of ore treated was lower this quarter than for December and there are quite a few reasons for that happening, in fact," she said.

This gold news item was posted on the Australia Broadcasting Corporation website on Sunday "down under"---and I thank South African reader B.V. for digging it up for us.

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1,000 platinum-powered Hyundais in UK this year – Amplats

Fuel cell electric vehicles will allow platinum mining to build its future in a truly sustainable way on the back of zero exhaust emissions and the use of the world’s endless supply of hydrogen as a fuel source, Anglo American Platinum (Amplats) CEO Chris Griffith has told Platinum Week 2015 in London.

Griffith said this against the background of Korean automotive manufacturer Hyundai targeting the production of 1,000 ix35 fuel cell vehicles in the U.K. by the end of this year.

Highlighting the need for continuous industry collaboration with customers and nontraditional partners to develop uses for platinum-group metals (PGMs), Griffith outlined that if fuel cell cars succeeded in dominating the electric vehicle segment in Europe, platinum demand within Europe would rise to 6.6-million ounces in 2050.

Conversely, if battery cars dominated, demand for platinum within Europe would decline to 2.5-million ounces in the same period.

This article, filed from Johannesburg, appeared on the miningweekly.com Internet site yesterday---and it's the second offering in a row from reader B.V.

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Above-ground platinum stocks unlikely to reach zero

Above-ground inventories of platinum are unlikely ever to reach zero, World Platinum Investment Council CEO Paul Wilson predicted.

Sizeable above-ground stocks are often cited as the primary reason for platinum’s failure to react to the current fundamental deficit.

“[But] they certainly don’t need to reach zero for sentiment to change and there could be a change to the price level in the marketplace,” he told delegates at the Bloomberg and CME Precious Metals Forum here on Friday.

Prices are now down 50 percent at $1,150 since the all-time peaks hit in 2008 at $2,300. The metal recently struck its lowest since the post-peak crash during 2008/2009 at $1,080 per ounce.

It's hard to believe that the guy running the World Platinum Investment Council is as ignorant as his brethren in the gold and silver mining industry, but this story proves that he is.  Until the Big 8 traders, led by JPMorgan et al, who are currently short 115 days of world platinum production get out of Dodge, the price of that precious metal is going nowhere as well.  This story, which was posted on the fastmarkets.com website, found a home over at the mineweb.com Internet site yesterday.

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As LME looks east, CME throws down challenge in west: Andy Home

The London Metal Exchange (LME) Asia festivities have just wrapped up in Hong Kong.

It is the third such annual event since the LME was bought by Hong Kong Exchanges and Clearing (HKEx) in 2012 and each year, it seems, the Asian gathering of the metals industry gets larger.

The grand old London lady of metals trading is all part of Charles Li's vision of positioning Hong Kong as the renminbi gateway between mainland China and international markets. The HKEx chief is confident the LME will help open up a commodities channel to complement the newly-opened Stock-Connect highway.

It's very much still an aspiration but LME Week Asia is where the foundation stones are being laid.

This opinion piece, filed from Singapore, appeared on the Reuters website last Friday---and I found it on the Sharps Pixley website just now.

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May 23, 2015

JPMorgan Officially Apologizes For Being a Criminal Market Manipulator

MAY 20, 2015 DISCLOSURE NOTICE

The purpose of this notice is to disclose certain practices of JPMorgan Chase & Co. and its affiliates (together, “JPMorgan Chase” or the “Firm”) when it acted as a dealer, on a principal basis, in the spot foreign exchange (“FX”) markets. We want to ensure that there are no ambiguities or misunderstandings regarding those practices.

To begin, conduct by certain individuals has fallen short of the Firm’s expectations. The conduct underlying the criminal antitrust charge by the Department of Justice is unacceptable. Moreover, as described in our November 2014 settlement with the U.K. Financial Conduct Authority relating to our spot FX business, in certain instances during the period 2008 to 2013, certain employees intentionally disclosed information relating to the identity of clients or the nature of clients’ activities to third parties in order to generate revenue for the Firm. This also was contrary to the Firm’s policies, unacceptable, and wrong. The Firm does not tolerate such conduct and already has committed significant resources in strengthening its controls surrounding our FX business.

But nobody went to jail.  Then there's the unmentionable crime against humanity by JPMorgan et al---the price management scheme against the precious metals in particular---and commodities in general.  This disclosure notice appeared on the JPMorgan website on Wednesday---and it's courtesy of Dan Lazicki.  I borrowed the headline from a Zero Hedge article.

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Matt Taibbi: World’s Largest Banks Admit to Massive Global Financial Crimes, But Escape Jail (Again)

In an interview with Democracy Now!, Rolling Stone journalist Matt Taibbi spoke about the recent news surrounding the five major banks – Citigroup, JPMorgan Chase, Barclays, Royal Bank of Scotland and UBS – who pled guilty to rigging the price of foreign currencies and interest rates. Their fines amount up to more than $5 billion.

“They were monkeying around with the prices of every currency on Earth,” Taibbi told Amy Goodman. “So, if you can imagine that anybody who has money, which basically includes anybody who’s breathing on the planet, all of those people were affected by this activity. So if you have dollars in your pocket, they were monkeying around with the prices of dollars versus euros, so you might have had more or less money fractionally, depending on all of this manipulation, every single day.”

There's a 33:15 minute video interview, but there's also a transcript.  This excellent commentary by Matt appeared on the alternet.org Internet site on Thursday---and it's the first offering of the day from Roy Stephens.

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N.Y. State investigators think Feds missed the bulk of big banks' forex rigging

Wall Street banks are facing the threat of new and more damaging allegations about their rigging of foreign exchange markets, as New York's banking regulator intensifies a probe into computer-driven currency trading -- raising the prospect that the total penalties arising from the scandal will exceed the $10 billion already paid.

The New York Department of Financial Services, run by Benjamin Lawsky, has become increasingly convinced that banks have been systematically abusing forex markets through the use of automated trades driven by computer algorithms, according to people familiar with its investigation.

Findings from the probe may indicate more widespread market abuse than U.S. and U.K. authorities disclosed on Wednesday, when detailing their settlement with six global banks, the people added. They pointed out that this $5.6 billion settlement related to allegations of market manipulation by bank employees -- but Mr Lawsky's probe covers electronic trading, which accounts for the majority of forex transactions.

The above three paragraphs are all that's posted in the clear from this Financial Times story from yesterday---and I found it embedded in a GATA release.

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SEC Commissioner Furious That SEC Has Made a Mockery of "Recidivist Criminal Behavior" by Banks

Yesterday, in the aftermath of the latest settlement by the world's biggest banks, who finally admitted they have criminally rigged virtually all markets since the Great Financial Crisis (and prior) despite promising repeatedly they would not do that after having been caught time and again and punished with ever "harsher" wrist slaps, we wrote that the "Public Is Confused Why World's Biggest Banks Admitting Criminal Fraud, Leads To Public Yawns."

It appears the public is not the only one who is confused, or yawning, that yet again banks get away with just another penalty (to be paid by their shareholders) and zero jail time for the perpetrators despite what is supposedly "criminal" rigging: none other than a SEC regulator working for the same enforcer who "punished" the Too Big To Prosecute banks only to immediately grant them waivers to continue business as usual, is just as confused.

Here, two weeks after SEC commissioner Cara Stein raged that the SEC would turn a blind eye to Germany's Deutsche Bank for a "Decade Of Lying, Cheating, And Stealing", is her dissenting opinion with the SEC settlement, this time broadening her anger to include all the banks, not just the German one.

This 'dissenting statement' appeared in this Zero Hedge article that appeared on their website at 7:58 a.m. EDT on Friday morning---and it's worth reading if you have the time.  It's the second offering of the day from Dan Lazicki.  There was more commentary on this in a story that was posted on the wallstreetonparade.com Internet site yesterday---and it's headlined "DoJ Calls Out UBS Rap Sheet; Ignores Homegrown Citigroup’s Rap Sheet"---and I thank Richard O'Mara for digging up that one for us.  It's worth reading as well.

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Fed still seen in lift-off mode as Yellen takes center stage

The U.S. Federal Reserve is likely to stick with plans to raise interest rates later this year, with progress towards its employment and inflation goals helping allay concerns over the economy's recent weakness, current and former Fed officials say.

Fed Chair Janet Yellen, who on Friday will talk about the economy's prospects, is expected to acknowledge the recent sluggishness, including near stagnant performance in the first few months of the year.

But she will also probably repeat the mantra that better days should follow a temporary swoon, and highlight the economy's steady job growth, keeping the Fed on track for its first policy tightening in nearly a decade.

Hours ahead of her speech inflation showed a flicker of life, with the Consumer Price Index, once stripped of volatile food and energy components, recording a 0.3 percent rise in April. Though the Fed uses another measure for its 2 percent target, the CPI report on Friday showed prices increasing across a broad set of items, giving the Fed "affirmation core trends are moving their way," said TD Securities analyst Eric Green. "In effect, inflation is not an obstacle to tightening."

Well, dear reader, I'll believe this rate increase when I see it.  This Reuters article, filed from New York, showed up on their Internet site at 11:47 a.m. EDT yesterday---and I thank Orlando, Florida reader Dennis Mong for sharing it with us.

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Doug Noland -- Paying for the Past: Insight from Lindsey, Fisher and Greenspan

The root cause of a complex predicament is actually rather uncomplicated: it’s called inflationism. And there’s a reason why I am not the least bit optimistic. Despite centuries of history, we’ve somehow bought into the fallacy that “money printing” can resolve structural issues (financial, economic and social). In the face of overwhelming contrary evidence, central bankers and their supporters have clung to the sophistry that they can raise prices levels – in the real economy and securities markets – and that such inflation supports system growth and stability. Central banks have over-promised and have been too content to feed fanciful notions of their omnipotence and overwhelming power. Progressively bolder “activist” central bankers were afforded way too much discretion to experiment. In the end, their inflationary policies primarily inflated asset prices and securities market speculative Bubbles. And each policy error – accommodating or, worse yet, orchestrating a new Bubble – invariably led to only bigger blunders. The greater the boom and bust the more outlandish the subsequent reflationary cycle and attendant Bubbles.

For today’s readers and for the reader in 2065, it is imperative to appreciate that the Fed (and global central bankers more generally) is today trapped. Borrowing from Larry Lindsey, “We’re at the point of absurdity.” Yet normalization from absurd rates and central bank monetization is indefinitely deferred because of fears of bursting Bubbles. The great danger of central bank controlled, market-based finance has come to fruition: central bankers see no alternative than to allow Bubbles to run wild. And unhinged markets will do what unsound markets do: go to self-reinforcing precarious excess.

The nature is unclear and the course always uncertain. The end game, however, is never in doubt. Inflationism is seductive – it sets an incredibly powerful trap. And it inevitably reaches the point of no return. If only the Fed would quickly mend its ways and begin normalizing rates. I very much wish it wasn’t too late. But these global Bubbles are not going to tolerate anything like normality.

Doug's weekly Credit Bubble Bulletin is always a must read for me---and this one is no exception.  I thank reader U.D. for passing it around early yesterday evening.

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Hundreds of Tech Companies Line Up to Oppose TPP Trade Agreement

More than 250 tech companies have signed a letter demanding greater transparency from Congress and decrying the broad regulatory language in leaked parts of the controversial Trans-Pacific Partnership trade bill.

The TPP would create an environment hostile to journalists and whistleblowers, said policy directors for the Electronic Frontier Foundation and Fight for the Future, co-authors of the letter. “TPP’s trade secrets provisions could make it a crime for people to reveal corporate wrongdoing ‘through a computer system’,” says the letter. “The language is dangerously vague, and enables signatory countries to enact rules that would ban reporting on timely, critical issues affecting the public.”

Among the signatories is activist, sci-fi author and The Guardian tech columnist Cory Doctorow. “Democracies make their laws in public, not in smoke-filled rooms,” Doctorow wrote. “If TPP’s backers truly believed that they were doing the people’s work, they’d have invited the people into the room. The fact that they went to extreme, unprecedented measures to stop anyone from finding out what was going on – even going so far as to threaten Congress with jail if they spoke about it – tells you that this is something being done to Americans, not for Americans.”

This story, which originally appeared on The Guardian website, was reposted on the alternet.org Internet site on Thursday---and it's the second contribution of the day from Roy Stephens.

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Hyperinflation in Venezuela, which just pawned its gold

Venezuelans are dumping their rapidly-depreciating currency at a quicker pace, leading to a staggering plunge in its free-market value, as the crisis-plagued economy edges closer to an outbreak of hyperinflation.

DolarToday, a widely followed website that tracks exchanges made near the Colombian border, reported today that the bolivar had lost a quarter of its value over the last seven days.

Everyone in smartphone-obsessed Caracas seemed to learn of the crash at the same time as the DolarToday app, a ubiquitous tool in the South American country, sent out a series of messages announcing the new rates under the headline "Hyperinflation!"

Venezuelan currency was trading at around 420 bolivars per dollar Friday afternoon, according to the site. That was down from 300 bolivars per dollar on May 14 and 173 at the start of the year.

This AP story from yesterday afternoon EDT was filed from Caracas---and was subsequently picked up by the news.yahoo.com Internet site---and is a must read.  I found it on the gata.org Internet site last night.

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Bank of England accidentally emails Brexit task force plans to newspaper

The Bank of England has accidentally revealed that it has set up a task force to look at how a U.K. exit from the European Union will affect the economy.

"Project Bookend" - as the Bank has dubbed the initiative - will be led by Sir Jon Cunliffe, deputy governor and a board member at the Prudential Regulatory Authority.

However, it is how the plans have been revealed that will cause embarrassment at the central bank.

Details of the task force, as well as how Bank officials should deal with media questions regarding a "Brexit", were accidentally e-mailed to The Guardian.

The e-mail was sent from Sir Jon's secretary to four senior executives at the Bank - Iain de Weymarn, Governor Mark Carney's private secretary; Nicola Anderson, head of risk assessment in the financial stability department; Phil Evans, director of the international division; and Jenny Scott, executive director communications. However, it was also accidentally forwarded to an editor at The Guardian.

You couldn't make this stuff up!  This news item appeared on the telegraph.co.uk Internet site at 7:45 p.m. BST in London yesterday evening, which was 2:45 p.m. EDT in Washington.  I thank South African reader B.V. for sending it our way.

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Apple and Google Just Attended a Confidential Spy Summit in a Remote English Mansion

At an 18th-century mansion in England’s countryside last week, current and former spy chiefs from seven countries faced off with representatives from tech giants Apple and Google to discuss government surveillance in the aftermath of Edward Snowden’s leaks.

The three-day conference, which took place behind closed doors and under strict rules about confidentiality, was aimed at debating the line between privacy and security.

Among an extraordinary list of attendees were a host of current or former heads from spy agencies such as the CIA and British electronic surveillance agency Government Communications Headquarters, or GCHQ. Other current or former top spooks from Australia, Canada, France, Germany and Sweden were also in attendance. Google, Apple, and telecommunications company Vodafone sent some of their senior policy and legal staff to the discussions. And a handful of academics and journalists were also present.

According to an event program obtained by The Intercept, questions on the agenda included: “Are we being misled by the term ‘mass surveillance’?” “Is spying on allies/friends/potential adversaries inevitable if there is a perceived national security interest?” “Who should authorize intrusive intelligence operations such as interception?” “What should be the nature of the security relationship between intelligence agencies and private sector providers, especially when they may in any case be cooperating against cyber threats in general?” And, “How much should the press disclose about intelligence activity?”

This interesting story showed up on The Intercept website yesterday morning EDT---and it's another contribution from Roy Stephens.

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Welsh wing-maker Airbus E.U. exit warning

The president of aerospace giant and Welsh wing-maker Airbus says the firm would reconsider U.K. investment if Britain left the European Union.

Paul Kahn said Britain must compete for international investment.

The company employs 6,000 people at its wing factory at Broughton, Flintshire, and a further 4,000 at Filton, Bristol.

The comments follow the head of JCB stating Britain should not fear an E.U. exit. It employs about 500 people at its Wrexham plant.

But speaking to the BBC, the Airbus president said the best way to guarantee continuing investment was "by remaining part of the E.U."

This BBC article was posted on their website on Thursday, but I saved it for today because there's a youtube.com video about how this company makes wings for the new Airbus 380.  I watched it a couple of weeks ago---and if the manufacturing process fascinates you, as it does me, this video is a must watch---and it's linked here.  By the way, this wing plant in Wales is not going anywhere, with or without the U.K. being in the E.U.  The reader that send me this story wishes to remain anonymous.

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Italy's 'eternally unfinished' highway enters final stretch - 50 years after construction began

Back in 1966, Lunar 9 was the first spacecraft to achieve a controlled landing on the Moon, England won the World Cup, and Italy opened the first section of the Salerno to Reggio Calabria motorway.

In the intervening half-century space missions have gone on to greater things, England have struggled to repeat their success, and, incredibly, Italy is still plodding on with the construction of the A3, “the eternally unfinished autostrada”, as it’s known.

Construction of the 443km stretch of road, which is supposed to run from Salerno, just south of Naples, down to the capital of the Calabria region, in the toe of the Italian boot, has been plagued by faulty construction, delays and scandal. Campaigners say that during this time it’s come to look like the incarnation of everything that’s wrong with the country, hamstrung by corruption and bad management. “It’s a symbol of how public works are in Italy,” said Stefano Zerbi, spokesman for the national consumer organisation, Codacons.

It’s not lost on anyone that the road stretches from Campania, the regional home of the Camorra crime syndicate, and then passes through the ‘Ndrangheta badlands, including towns such as Rosarno and Gioia Tauro.

Obviously I don't know much about it Italy, because my jaw hit the floor, as I couldn't believe what I was reading.  Truth is really stranger than fiction---and for that reason you should seriously consider reading this.  It appeared on the independent.co.uk Internet site on Wednesday---and for obvious reasons had to wait for today's column.  Once again I thank Roy Stephens for sharing it with us.

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Eastern Promises: Riga Summit Ends With Division, Little Progress

The Eastern Partnership summit in Riga ended with growing divisions and no promises on issues of visa-free travel, which worried some members.

The European Union's Eastern Partnership summit with six ex-Soviet states ended with little progress as the partnership countries were divided in their aspirations for European integration and their goals for visa-free travel.

The representatives of Armenia, Azerbaijan and Belarus refused to sign the initial document which stated that the summit condemned Russia's reunification with Crimea, which the document called an "illegal annexation." Ukrainian President Petro Poroshenko, who was waiting for a "signal" from the E.U. on a visa-free regime, was told by German Chancellor Angela Merkel that the E.U. is not ready for it.

This news item was posted on the sputniknews.com Internet site at 5:08 p.m. Moscow time on their Friday afternoon, which was 10:08 a.m. EDT in Washington.  It's another contribution to today's column from Roy Stephens.  There was a Bloomberg story on this Riga Summit.  It's headlined "Greek Talks Break Up as Earlier Optimism Evaporates"---and it showed up on their Internet site at 5:05 p.m. Denver time on Thursday afternoon.  I found it in yesterday's edition of the King Report.

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John Batchelor Interviews Stephen F. Cohen

Just when events are said to be winding down in the Ukraine Civil War we see that after Assistant Sec. State, Nuland’s visit to Moscow last weekend and her assurances that Kiev is on side with Minsk2, the Donetsk Airport area just a day later came under the heaviest shelling for months.

And John Batchelor and Stephen F. Cohen make an effort to find out what is really happening through the “fog of diplomacy” with this process. Last week they see three main features of interest and new very serious global concerns for the  New Great Game:

1) Dimitry Medvedev, the Russian Prime Minister disallows use for USA to supply Afghanistan from Russian Federation territory.

2) Kyiv is claiming the capture of two Russian soldiers.

3) And probably most important, a positional statement from the Carlisle Barracks, the United States Army War College, that essentially told the White House that a containment policy against Russia will not work and it is time to consider one of cooperation and competition. At present, as the parties work out strategies the United States, NATO, Russian and Europe, our esteemed pundits here try to determine whether the Western players, especially Washington, are truly backing away from supporting Kyiv or whether this is a ploy.

If you're following events in the Ukraine, this 39:50 minute audio interview is certainly worth your while.  It was posted on the johnbatchelorshow.com Internet site on Tuesday---and I thank Larry Galearis for bringing it to our attention.

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What if Putin is Telling the Truth? -- F. William Engdahl

On April 26 Russia’s main national TV station, Rossiya 1, featured President Vladimir Putin in a documentary to the Russian people on the events of the recent period including the annexation of Crimea, the U.S. coup d’etat in Ukraine, and the general state of relations with the United States and the E.U. His words were frank. And in the middle of his remarks the Russian former KGB chief dropped a political bombshell that was known by Russian intelligence two decades ago.

Putin stated bluntly that in his view the West would only be content in having a Russia weak, suffering and begging from the West, something clearly the Russian character is not disposed to. Then a short way into his remarks, the Russian President stated for the first time publicly something that Russian intelligence has known for almost two decades but kept silent until now, most probably in hopes of an era of better normalized Russia-U.S. relations.

Putin stated that the terror in Chechnya and in the Russian Caucasus in the early 1990’s was actively backed by the CIA and western Intelligence services to deliberately weaken Russia. He noted that the Russian FSB foreign intelligence had documentation of the U.S. covert role without giving details.

What Putin, an intelligence professional of the highest order, only hinted at in his remarks, I have documented in detail from non-Russian sources. The report has enormous implications to reveal to the world the long-standing hidden agenda of influential circles in Washington to destroy Russia as a functioning sovereign state, an agenda which includes the neo-nazi coup d’etat in Ukraine and severe financial sanction warfare against Moscow. The following is drawn on my book, “The Lost Hegemon” to be published soon…
 

This is your big read of the day---and is an absolute must read for any serious student of the New Great Game.  It put in an appearance on the journal-neo.org Internet site a week ago Friday and, not surprisingly, it's courtesy of Roy Stephens---and is another piece that had to wait for a spot in my Saturday missive.

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New Silk Road vs. TPP: East and West Enter 'War' For Dominance in Eurasia

As China's New Silk Road project is seemingly aimed at a "revolutionary change" in the global economic map, it may lead to a serious confrontation between the East and the West over Eurasian dominance, says U.S. analyst Robert Berke.

Washington's new Trans-Pacific Partnership (TPP) initiative that leaves out both China and Russia, has clearly demonstrated that U.S. participation in China's New Silk Road project seems unlikely while its "opposition is all but certain," American energy financial analyst Robert Berke stated in a recent article on Oilprice.com.

"The [New Silk Road] project aims at no less than a revolutionary change in the economic map of the world. It is also seen by many as the first shot in a battle between east and west for dominance in Eurasia," the financial analyst stressed.

The New Silk Road is expected to connect Asia, Europe and Africa.

This article was posted on the sputniknews.com website at 6:27 p.m. Moscow time on their Friday evening---and it's definitely worth reading.  Once again I thank Roy Stephens for digging it up for us.

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China Jams U.S. Spy Drones Over Disputed South China Sea Islands

China tried to electronically jam U.S. drone flights over the disputed South China Sea in order to prevent surveillance on man-made islands Beijing is constructing as a part of an aggressive land reclamation initiative, U.S. officials said.

Global Hawk long-range surveillance drones were targeted by jamming in at least one incident near the Spratly Islands, where China is building military facilities on Fiery Cross Reef, the Washington Free Beacon reported.

That statement follows Thursday reports that the Chinese navy warned a U.S. surveillance plane to leave the same area eight times in an apparent effort to establish and enforce a no-fly zone, a demand Washington rejected.

This news item appeared on the sputniknews.com Internet site at 11:00 p.m. Moscow time on their Friday evening, which was 4 p.m. EDT.  It's the final contribution of the day from Roy Stephens---and I thank him on your behalf.

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Two more Hong Kong stocks collapse after Hanergy crash

Two of Hong Kong's best-performing stocks plunged more than 40 percent Thursday, a day after a mysterious crash of almost 50 percent in Chinese solar firm Hanergy that saw almost $20 billion wiped off its market value.

Goldin Financial sank 43.34 percent to HK$17.48 and Goldin Properties crashed 40.91 percent to HK$14.36, after soaring more than 300 percent since the start of January, according to Bloomberg News.

The companies, which have interests ranging from property development in Hong Kong and China to vineyards in California and France are owned by Chinese tycoon Pan Sutong.

The dramatic sell-off came after a 47 percent dive in Beijing-based solar energy firm Hanergy Thin Film Power (HTF).

This business-related AFP story, filed from Hong Kong on Thursday local time, ended up on the terradaily.com Internet site---and it's worth skimming.

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Sprott Money Weekly Wrap Up

Listen to Eric Sprott share his views on Friday’s release of economic data, BitGold’s recent merger with Gold Money, the lending of more funds to Greece by the European Central Bank, and the smash in gold on yesterday morning.

This 11:18 minute audio clip with host Geoff Rutherford was posted on the sprottmoney.com Internet site yesterday evening.

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BitGold to acquire GoldMoney for shares in transaction estimated at C$52 million

BitGold Inc., a platform for savings and payments in gold, announces that it has entered into an acquisition Agreement to purchase the operating and intellectual property assets of GoldMoney Network Ltd., subject to regulatory approvals and other customary closing conditions.

With over C$1.5 billion in assets under vault management, GoldMoney is among the world's largest private managers of precious metal assets, renowned for its innovation and integrity in the gold market.

Upon closing of the acquisition agreement, BitGold will acquire the intellectual property and operating assets of GoldMoney in exchange for the issuance of 11,169,794 common shares in BitGold, valuing the transaction at C$51.9 million based on BitGold's C$4.65 closing price on May 21. The transaction is expected to close within 60 days.

This news item, filed from Toronto, showed up on the businesswire.com Internet site yesterday at 07:50 a.m. EDT---and I found it embedded in a GATA release.

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Koos Jansen: Chinese gold leasing is much lower than establishment claims

Welcome to another episode of understanding how mainstream consultancy firms (the World Gold Council, GFMS, CPM Group, Precious Metals Insights) understate Chinese gold demand. One of their main arguments is that hundreds if not thousands of tonnes are tied up in Chinese Commodity Financing Deals (CCFDs). As it was first stated by the World Gold Council (China’s Gold Market Progress And Prospects, April, 2014):

No statistics are available on the outstanding amount of gold tied up in financial operations [CCFDs] linked to shadow banking but Precious Metals Insights believes it is feasible that by the end of 2013 this could have reached a cumulative 1,000 tonnes.

Many mainstream news outlets, such as Reuters and the Financial Times, copied this segment, writing something along the lines of “1,000 tonnes is tied up in financing deals, it’s all a fraud and when this will be unwound the gold will flush the Chinese market”. In reality there was not 1,000 tonnes tied up in financing deals in 2013, as was portrayed by the WGC report.

This rather brief commentary appeared on the bullionstar.com Internet site early yesterday morning Singapore time---and I thank Koos for passing it around.  It's worth reading.

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Kronen Zeitung: Austria Repatriates 110 Tonnes of Gold From U.K.

Austria is repatriating gold from the vaults at the Bank Of England (BOE) at this very moment, according to Kronen Zeitung. The OeNB (central bank of the Republic of Austria) stored 82 % of its 280 tonnes at the depository in England. It will start by bringing back 110 tonnes to Austria, to eventually have 50% on its own soil. 

This was to be expected as Austria has steadily working to move more of its official gold reserves from unallocated to allocated accounts in recent years, and additionally reduced its gold leased out by a staggering 60%.

This is another brief commentary from Koos---and it appeared on the bullionstar.com Internet yesterday afternoon Singapore time.  It's definitely worth reading as well.  Here's the Zero Hedge spin on this story---and it's headlined "Austria Confirms Faith in Fiat Fading: Repatriates 110 Tons of Gold From BoE"---and I thank reader 'David in California' for passing that one around yesterday morning.

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China on a gold standard? Food for thought at least -- Lawrence Williams

On Friday at Bloomberg’s own  Precious Metals forum in London, Hoffmann gave a further short talk setting out the hypothesis – seeing the possibility of China going down this route as a possible Black Swan scenario.  While, in a short article released at the event he admits that the backing of the yuan fully by gold is an exercise that is highly unlikely and that in any case the Chinese government would not wish to have its monetary policy hands tied to the extent a traditional gold standard would suggest.  Indeed he admits that while the debate on this is an interesting one, ‘the idea of China on the gold standard is likely to remain in the alchemist’s lab for now’.

So what Hoffmann has done is to bring the idea of a Chinese introduction of some form of gold standard into the debate and for that he should be praised rather than vilified by those who find the whole idea counter to their own views.  The Chinese are indeed capable of springing surprises on the West.  As pointed out earlier the Chinese have a different way of thinking than us westerners.  They tend to operate with the kind of long term game plan no longer even considered in most capitalist countries and with a centrally controlled economy are perhaps far better placed to implement economic reforms which are to their ultimate benefit which might be considered impossible in the Western thought train.

So while a Chinese return to some kind of gold standard may be extremely unlikely, one perhaps should not write the idea off as totally impossible, and Hoffmann has done us a favour in getting us to think outside the box ourselves.

This short commentary by Lawrie was posted on his own website yesterday---and it's worth the read as well.

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